The company makes 420 units of product YBY a year, requiring a total of 460 machine-hours, 80 orders, and 10 inspection-hours per year. The product's direct materials cost is $48.96 per unit and its direct labor cost is $25.36 per unit. According to the activity-based costing system, the average cost of product YBY is closest to:

The company makes 420 units of product YBY a year, requiring a total of 460 machine-hours, 80 orders, and 10 inspection-hours per year. The product's direct materials cost is $48.96 per unit and its direct labor cost is $25.36 per unit. According to the activity-based costing system, the average cost of product YBY is closest to:

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Milton6 Company uses a standard cost system in which manufacturing overhead costs are applied to units of product (widgets) on the basis of direct labor hours. Standards call for 2 direct labor hours per widget. The standard labor rate is $10 per hour. Four pounds of material are needed for each widget at a standard cost of $2.25 per pound. The standard variable overhead rate is $3.50 per direct labor hour. Milton6 actually produces 17,000 widgets during the year. Direct labor costs are S359,100 for 34,200 hours. Milton6 purchases 70,000 pounds of materials at $2.50 per pound, and used 65,400 pounds of those materials (the rest are in inventory at the end of the year) Actual variable overhead costs $92,000. For variable overhead, compute the spending(price) variance and label it is favorable (F) or unfavorable (U). А. 700 F В. 32,500 F C. 27,700 U D. 700 U E. 32,500 U F. 27,700 F G. 27,000 U Н. 27,000 F B.
Solomons, Inc. has refined its allocation system by separating manufacturing overhead into two cost pools, one for each department. The estimated cost for the mixing department, $615,000, will be allocated based on direct labor hours, and the estimated direct labor hours for the year are 201,000. The estimated cost for the packaging department, $293,000, will be allocated based on direct labor hours, and the estimated machine hours for the year are 59,200. In October, the company incurred 17,240 direct labor hours in the mixing department and a total of 14,260 machine hours in the packaging department.(Round your answers to two decimal places when needed and use rounded answers for all future calculations).1. Compute the predetermined overhead allocation rates. Department Total estimated overhead cost ? Total estimated quantity of the overhead allocation base = Predetermined Overhead Allocation Rate (Per Machine Hour) Mixing Department = Packaging Department =…
The controller of PUSO Co. estimates the amount of materials handling overhead cost that should be allocated to the firm's two product using the data below: Specialty Windows 7,000 Wall Mirrors Total expected units produced Total expected materials move Expected direct labor per unit 8,000 900 300 7 5 The total materials handling cost for the year is expected to be P38, 448. If the materials handling cost is allocated on the basis of direct labor-hours, how much of the total material handling cost should be allocated to the specialty windows?
One of Astro Company's activity cost pools is machine setups, with estimated overhead of $150,000. Astro produces sparklers (400 setups) and lighters (600 setups). How much of the machine setup cost pool should be assigned to sparklers?
Vandalay Industries manufactures two products: toasters and blenders. The annual production and sales of toasters is 2100 units, while 1600 units of blenders are produced and sold. The company has traditionally used direct labor hours to allocate its overhead to products. Toasters require 1.25 direct labor hours per unit, while blenders require 1 direct labor hours per unit. The total estimated overhead for the period is $149,315. The company is looking at the possibility of changing to an activity-based costing system for its products. If the company used an activity-based costing system, it would have the following three activity cost pools: Expected activity Activity cost pool Estimatedoverheadcost Toasters Blenders Total Setup costs $8585 215 batches 450 batches 665 batches Engineering costs $73,980 870 engineering 820 engineering hours 1690 engineering hrs Maintenance costs $66,750 2750 direct labor hours 1195 direct labor hours 3945 direct labor hours Total…
Lynwood, Inc. produces two different products (Product A and Product X) using two different activities: Machining, which uses machine hours as an activity driver, and Inspection, which uses number of batches as an activity driver. The activity rate for Machining is $180 per machine hour, and the activity rate for Inspection is $580 per batch. The activity drivers are used as follows: Product A: (machine hours= 1,200) (number of batches 55) Product X: (mahine hours= 3,200) (number of batches 18) Totals: (Machine hours= 4,400) (number of batches 73) What is the amount of Machining cost assigned to Product X?
GEM Limited has a single product Flicks. The company normally produces and sells 80,000units of Flicks each year at a price of $240 per unit. The company’s unit costs at this level ofactivity are as follow:Direct material $57.00Direct labor 60.00Variable manufacturing overhead 16.80Fixed manufacturing overhead 30.00Variable selling and administrative costs 10.20Fixed selling and administrative costs 27.00 Total unit cost $201.00GEM has sufficient capacity to produce 100 000 units of Flicks a year without any increase infixed manufacturing overhead.Required:(a) GEM has an opportunity to sell 10 000 units to an overseas customer. Import duties andother special costs associated with this order would total $42 000. The only selling coststhat would be associated with the order would be a shipping cost of $9.00 per unit.What would be the minimum acceptable unit price for GEM to consider this order?(hint: GEM would not accept the order if it would reduce the…
The following Informetlon relates to a company with a relevant range of activity from 10,000 units to 15,000 unlts. They are currently producing and selling 12,000 units. The average cost per unit is $7.40 for direct materlals; $4.00 for direct labor, and $4.00 for varlable manufacturing overhead. The average fixed cost per unit is $14.20 for fixed manufacturing overhead; $2.70 for fixed selling expenses and $1.80 for fixed administrative expenses. Variable selling expenses are $.60 per unit and varlable administrative expenses are $.50 per unit. Required: (For questlons a. - d. assume that 14,000 units are produced and sold.) a. Calculate the total amount of varlable cost for the units sold. b. Calculate the varlable cost per unit sold. (Round "Per unit" answer to 2 decimal places.) c. Calculate the total amount of fixed manufacturing costs. d. Calculate the average fixed manufacturing cost per unit produced. (Round "Per unit" answer to 2 decimal places.) e. Calculate the Incremental…
Milton6 Company uses a standard cost system in which manufacturing overhead costs are applied to units of product (widgets) on the basis of direct labor hours. Standards call for 2 direct labor hours per widget. The standard labor rate is $10 per hour. Four pounds of material are needed for each widget at a standard cost of $2.25 per pound. The standard variable overhead rate is $3.50 per direct labor hour. Milton6 actually produces 17,000 widgets during the year. Direct labor costs are $359,100 for 34,200 hours. Miltonó purchases 70,000 pounds of materials at $2.50 per pound, and used 65,400 pounds of those materials (the rest are in inventory at the end of the year) Actual variable overhead costs $92,000. For variable overhead, compute the spending(price) variance and label it is favorable (F) or unfavorable (U). A. 700 F B. 32,500 F C. 27,700 U D. 700 U E. 32,500 U F. 27,700 F G. 27,000 U Н. 27,000 F